If global economy is going to get slower, would investors be willing to take on more risk?

Morgan Stanley’s Joachim Fels: ’We have a global economy that has entered what I call the twilight zone’
Services industries from Asia to Europe cooled last month after the euro-area debt crisis pulled economies including Spain and Italy into recession and damped global growth prospects.

The purchasing managers’ index fell to 53.7 in September from 56.3 in August, the National Bureau of Statistics and China Federation of Logistics and Purchasing in Beijing said today. That’s the lowest since at least March 2011. In the euro-area, a gauge slipped to 46.1 last month from 47.2 and a U.K. measure also fell. Readings below 50 indicate contraction.

“First of all there’s still fiscal tightening going on,” Fels told Tom Keene and Sara Eisen on Bloomberg Television’s “Surveillance” on Oct. 1. “We have a global economy that has entered what I call the twilight zone — that’s the fuzzy area between sustained expansion and renewed recession. The global data are still weakening. There are domestic and global reasons why the economy in Europe is weakening further.”